[Congressional Record Volume 144, Number 31 (Thursday, March 19, 1998)]
[Senate]
[Pages S2347-S2348]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                      INTERNATIONAL MONETARY FUND

 Mr. BIDEN. Mr. President, I want to take a few minutes this 
afternoon to address the urgent need for IMF funds, to restore 
confidence to a fragile international financial system and to maintain 
a leadership role in the world economy.
  I am pleased to see that the Appropriations Committee has moved 
quickly this week to provide funding for continued U.S. participation 
in the IMF--both for the new arrangements to borrow that represent the 
emergency reserves of the fund, and for the quota increase to restore 
the IMF's ability to meet potential new demands on its resources.
  The current news from Asia--declining U.S. exports, the threat of 
increased imports, a more fragile international banking system--has 
brought home to us the importance of international cooperation to 
prevent the outbreak and spread of financial crises. It also reinforces 
the need to move quickly to restore the IMF's ability to contain the 
current crisis and to maintain the IMF's ability to respond to future 
problems.
  That is why I am concerned about some of the conditions put on the 
IMF funds in the Appropriations Committee on Tuesday. Treasury 
Secretary Rubin, who, along with Federal Reserve Chairman Greenspan has 
repeatedly reminded Senators of the need for quick action on these 
funds, has called those conditions--and I quote: ``Impractical to the 
point of being unworkable.''
  This is no way to treat funds that are needed to restore the 
equilibrium of the international financial system, and to no way 
maintain the leadership of the United States in the world economy.
  The International Monetary Fund was created by us at the end of World 
War II to maintain the stability of the international financial system. 
Today, its task as the lender of last resort in the kinds of meltdowns 
we have seen in Asia is by no means simple.
  With the rise of market economies among the developing nations of the 
world, and with the expansion of the international financial system--
both developments that promote the long-term interests of the United 
States--the task of the IMF has become increasingly difficult.
  I am not here today, Mr. President, to argue that the IMF is a 
perfect institution; in fact, our own Treasury, under the leadership of 
Secretary Rubin, has used its substantial influence to push for 
important reforms, to open the IMF to greater public understanding and 
trust. Secretary Rubin is also working with his counterparts around the 
world to reform the workings of the international banking system to 
reduce the risk of crises such as one we watch today in Asia with great 
concern.
  As the leader in the world's economy--indeed as the model economy 
which the rest of the world aspires to emulate--we in the United States 
have a special role to play in helping to sustain the health of the 
international economy. By maintaining our position in the IMF--by 
paying our dues and maintaining our dominant position there--we will 
remove lingering doubts in financial markets that make recovery and 
reform in Asia harder to achieve.
  And, as the most open economy in the world, we have the greatest 
stake in maintaining the stability of international trade and finance. 
The longer we leave the issue of our IMF commitment in doubt, the more 
our own farmers, workers, and manufacturers will lose overseas sales.
  I want to remind my colleagues that our contributions to the IMF 
don't cost American taxpayers a dime. Like deposits in a credit union 
of our own making, our contributions are matched by interest-bearing 
assets, and we can

[[Page S2348]]

call for the return of those contributions if we choose. For those 
reasons, those contributions have no impact on our Federal deficit--or 
the surplus we now enjoy.
  With the outcome of the Asian crisis still to be determined, with the 
world looking to us for the leadership that will restore confidence to 
private sector investors, we must act quickly and decisively to 
maintain the strength of the IMF--and to maintain our own dominant 
voice within the IMF. We should not make demands of the IMF that could 
delay indefinitely the day when private financial markets regain the 
confidence that will mark the turning point in the current financial 
crisis.
  That is why I am pleased that my friend and colleague on the Foreign 
Relations Committee--chairman of the International Economic Policy 
Subcommittee--Senator Hagel, has taken the lead in introducing 
legislation authorizing funds for the IMF with workable, sensible 
reforms. Together with Senator Grams on our committee, and Senators 
Roberts, Chafee, and Domenici, Senator Hagel has provided us with an 
important point of reference when we consider IMF funding here on the 
Senate floor.
  And I hope that will happen soon. Right now, there is no guarantee 
that we will take up the urgent issue of IMF funding at any time this 
year. Failure to act, and to act soon, would be irresponsible. It would 
expose the United States as vacillating, indecisive, and unable to lead 
in a time when what is needed most is leadership and commitment to 
restore confidence and stability to a shaken financial system.
  Similarly, it would be irresponsible to add unrelated, highly charged 
issues to the consideration of what are clearly urgently needed funds 
for the IMF.
  Mr. President, I am confident that in the end, the United States 
Senate will respond to the current challenge with both the decisiveness 
and good judgment that must characterize the actions of a great Nation 
in time of crisis.
  I look forward to working with all of my colleagues to make that 
faith a reality.

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